Payment (purchase account)

Use the Payment tab to enter the payment method, payment terms and the settlement discount for the supplier. You can also specify a factor house, if your supplier uses one to collect payments on their behalf.

Enter your supplier payment details

Open: Purchase Ledger > Purchase Accounts > Enter New Account | Payment.

Open: Purchase Ledger > Purchase Accounts > Amend Account Details.

• Select existing purchase account reference.
• Select Payment tab.

1. Enter the Payment terms:

   • Select the method of payment from the Payment group drop-down list.

     Payment groups are set up in the Purchase Ledger settings Groups tab.

     Note: If you are amending a supplier account, you cannot change this if there are payments waiting to be processed in the suggested payments file, generated when automatically processing supplier payments.

   • Select the Account Type.

     About supplier account types

     Use the Account types to decide how transactions are stored on individual supplier accounts. You can use all three account types in your Purchase Ledger in any mix. Use the account types to balance your need for a detailed breakdown of a supplier's transactions with your need to save disk space.

     The default account type is Open item.

     You can change a supplier account from one type to another. If you change a balance forward account to open item, you will only be able to view details for transactions entered after you made the change.

     Open Item

     For open item accounts, transactions remain visible on the account until they are archived or removed.

     How transactions are archived

     Transactions that are fully allocated, and that have exceeded the number of months specified to keep transactions for, are archived or removed when the relevant Account Maintenance option is run.

     • If you have selected to archive your transactions in the Ledger settings, the transactions are moved to an archive file. Once archived they can be viewed on the relevant archived Transaction Enquiry screens and historical reports.
     • If you have not chosen to archive your transactions, they are permanently removed from the Sage 200 database.

     For example: You have chosen to keep your transactions for 3 months for all of your Accounts. You enter the Archive up to date as 30 November. All allocated transactions dated prior to 01 September are archived or deleted.

     All outstanding transactions are kept, regardless of their age. Outstanding transactions are:

     • Part allocated payments.
     • Disputed transactions.
     • Unpaid invoices.
     • Part paid invoices.

     Balance forward

     With Balance Forward accounts, individual transactions are removed and replaced with a brought forward balance for each accounting period. The brought forward balance is created, when the relevant Account Maintenance option is run.

     Each period's total balance is carried forward as a single balance figure and so the number of balances carried forward depends on the number of accounting periods that you have.

     When transactions such as payments are posted for a previous period, they are allocated by period number, so the appropriate balance is amended. Queried transactions are kept on the account.

     The advantage of this type of accounting is its economical use of disk space.

     Note: Balance forward accounts cannot be used for foreign currency accounts.

     Settlement discounts with balance forward accounts

     We recommend that you don't use Balance Forward for accounts where you offer a settlement discount. This is because the discount details are lost when individual transactions are replaced with the brought forward balance.

     Automatic Allocation

     With Automatic Allocation accounts any credit notes, payments or receipts are allocated to invoices when the relevant Account Maintenance option is run. The oldest outstanding invoices are allocated first. Queried invoices are not allocated.

     Any debits or credits that are not allocated are carried over into the new period. If the transaction values do match exactly, the transactions are part-allocated.

     Transactions that are fully allocated, and that have exceeded the number of months specified to keep transactions for can be archived or removed.

     • If you have selected to archive your transactions in the Ledger settings, the transactions are moved to an archive file. Once archived they can be viewed on the archived transaction enquiry screens and historical reports.
     • If you have not chosen to archive your transactions, they are permanently removed from the Sage 200 database.

     If you select this type of account, you cannot select payments manually to allocate to a specific invoice when the period end is run.

2. Enter the Settlement discount details.

   These are default settings that are applied automatically every time you enter an invoice, order or credit note for this supplier. These will also default to the discount entered in the Purchase Ledger settings.

   To enter a different settlement discount for this supplier:

   • Enter the Settlement discount percentage.
   • Enter the number of days that you have to pay in to qualify for the discount, in the if paid within box.
   Settlement discounts and VAT

   • In the UK, VAT on an invoice is only discounted when it is paid within the settlement discount period.

     On each invoice, VAT is calculated by default on the full invoice value. If the invoice is paid within the settlement discount period, a VAT adjustment is required, to account for the discounted VAT.

   • In Ireland, VAT is calculated on the full value of the invoice regardless of any settlement discount.

3. If your supplier uses a factor house to collect payments on their behalf, select the Factor house from the drop-down list.

   You must have set up the Factor house details.